eBusiness and

eCommerce

Chapter 3

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Learning Objective 2

Explain what is mean by eBusiness,

eCommerce, and Web Commerce.

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Electronic Business and

Electronic Commerce
Electronic business (eBusiness) refers to
the use of IT in any aspect of the business.
Electronic commerce (eCommerce) is defined as
using IT in the exchange of products and services
among organizations and individuals.
Web Commerce involves using IT in the exchange
of products and services among individuals
and organizations and over the Internet.
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Learning Objective 1

Explain the history of the

Internet and how it works.

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Electronic Networks
Electronic networks are groups of computers
that are connected together electronically.
Local area networks (LANs) are
networks that span a single site.
Metropolitan area networks (MANs)
span a single city or metropolitan area.
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Electronic Networks
Wide area networks (WANs)
are networks of computers
that span at least two
metropolitan areas.

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The Internet
The Internet is an electronic highway that allows
computers to communicate with each other.
The earliest practical version of the Internet was
created in the early 1970s by the Pentagons
Advanced Research Projects Agency (ARPA).
It was called ARPANET.
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The Internet

Bitnet

MILnet

NSFnet

They adopted a common set of communications

protocols called TCP/IP (Transmission Control
Protocol/Internet Protocol).
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The Internet
Transmission Control Protocol (TCP) divides
electronic messages into packets of information
and then reassembles these packets at the end.
Internet Protocol (IP) assigns a unique
address to each computer on the Internet.

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The Internet
Fixed IP address
Dynamic IP address
Domain name
Domain name servers
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Intranets and Extranets

It is a self-contained, in-house internet.

Extranets exist when the intranets of two
or more companies are linked together,
or when outsiders (such as customers or suppliers)
are able to access
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Intranet Security Issues

The Internet

Corporate Intranet

Network
computers

Firewall
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Client-Server Technology

It is a robot-type program that

constantly runs on some computers
and exchanges information with clients.

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Types of Servers
There are many kinds of servers on the Internet:
Mail servers

File servers

Web servers

Commerce servers

Application servers and Database servers

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Types of Servers
Mail Server
Senders
mail
client

Receivers
mail
client

Message
sender

Message
receiver
Senders
mail
server

Receivers
mail
server
The Internet

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Types of Servers
What are file servers?
File servers exist mainly
as repositories of files.
The most common protocol
for file serves is called FTP.
A file server that uses this
protocol is called an FTP server.
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Types of Servers
What is a Web server?
It is a server that allows a user (client)
to access documents and run computer
programs that reside on remote computers.
All Web clients (web browser) automatically
read and interpret HTML
(hypertext markup language).
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Types of Servers

They are specialized types of Web servers

with various commerce-related features.
Support for various types of client
and server authentication

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Types of Servers
Support for interfacing
with external programs
Enhanced security features
Support for various types
of electronic payments

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Types of Servers
Bank

Order/payment
information

Encrypted
communication
link

Consumers
Consumers
client
client

Internet

Verify
payment
Commerce
Commerce
server
server

Product information
and order verification
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Types of Servers

Corporate
Corporate
accounting
accounting
system
system

Commerce
Commerce
server
server

Goods shipped
to customer

Shipping
Shipping

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Order
Order
file
file

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Types of Servers
Application Servers and Database Servers make
applications and data in databases
available to remote clients.
An application is a software program for some
functional use such as for
accounting, communications, or email.
A database is an organized collection of data that is
structured to be useful to those who use it.
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Three-tiered Application
Architecture
Presentation
tier

Logic
tier

Data
tier

Web
browser

Application
Server

Database
Server

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Learning Objective 3

Describe Enterprise
Architecture
and its domains

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E-Business and
Enterprise Architecture
AISs have evolved from simple recordkeeping and
reporting systems to sophisticated
Enterprise Application Suite (EAS).
SAP integrated operations, human relations,
and customer relations into
single software packages called ERP systems.
ERP systems were expanded to ERP II, and
ultimately into the EAS.
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E-Business and
Enterprise Architecture
AIS specialist needs to understand
how IS is embedded into
the enterprise architecture.
Enterprise architecture (EA) describes the joint
structure and behavior of the enterprise
and its information system.

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E-Business and
Enterprise Architecture
The enterprise architect is a person who
designs enterprise architectures to achieve
the following objectives:
Alignment of IT planning and strategy with business goals
Risk management associated with the IS
Optimal use of IS resources
Flexibility to adapt to IS to changing management needs

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E-Business and
Enterprise Architecture

Business
Information
Applications
Technical
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The Corporate Information

Factory

Data Acquisition
Data Management
Data Delivery

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The Corporate Information

Factory
Operations

Decision Support Interface

EDI

Datamart
Data
Acquisition

Data
Management

Data
Delivery
Datamart

ERP
Other
Operations

Data
Warehouse

Planning and Analytics

Operational
Database

Internet
Point of
Sale

Exploration
Warehouse

Data Mining
Warehouse

Transaction Interface

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The Applications Architecture

Applications architecture defines the applications
needed to run the business and how
the applications communicate
with each other through intranets, extranets, and EDI.

Use an ERP or EAS for application needs

Use an ERP or EAS in combination with other applications
Use some mixture of individual applications
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The Applications Architecture

Rely on the data sharing of ERPs and EASs

Use Service Oriented Architecture (SOA)
Use Client-Server technology
Use Middleware

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The Technical Architecture

Technical architecture describes the structure and
behavior of the IT infrastructure
and defines standards, principles, procedures,
and best practices to govern the IT architecture.
Applications, Database,
Enterprise Systems Management, Information,
Integration, Network and Comm, Platform, Security
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Learning Objective 4

Explain Enterprise Architecture

frameworks and
business process reference models

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Enterprise Architecture
Frameworks
The Zachman Framework
The Federal Enterprise Architecture (FEA)
The Open Group Architecture Framework (TOGAF)

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Business Process Frameworks

and
Reference Models
Business process frameworks focus on
transforming business processes,
making them better.
Business process reference model is
a set of best practices for a given
business process or group of processes.

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Business Process Frameworks

and
Reference Models
Value Chain Frameworks

Supply Chain Frameworks

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E-Business Architectures
eBusiness can be viewed as an enterprise architecture;
that is, a given set of specifications
for the 4 architectural domains.
Osterwalder Reference Model (ORM) defines
the typical business model in terms of
4 major domains:
Infrastructure, Offering, Customers, and Finance
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Learning Objective 5

Describe various approaches

to securing electronic
financial transactions.

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E-Commerce Technologies

Secret-key encryption
Public-key encryption
Digital envelopes
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Secret-Key Encryption
Secret key

Message

Encryption

Decryption

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Message

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Public-Key Encryption
Recipients public key

Message

Encryption

Recipients private key

Ciphertext

Decryption

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Message

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Digital Envelope
What is a digital envelope?
It is an encryption method in which the
message is encrypted with a secret
key, and the secret key is encrypted
with the recipients public key.
This method is sometimes referred
to as double-key encryption.
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Double-Key Encryption
Recipients
public key

Random
message key
Public-key
encryption

Message

Private-key
encryption

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Encrypted
message key

Ciphertext
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Double-Key Encryption
Recipients
private key
Message key
Encrypted
message key

Ciphertext

Public-key
decryption

Private-key
decryption

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Message
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Digital Signatures
A digital signature occurs when someone encrypts
a message with his or her own private key.
What is a hashing function?
A hashing function takes a long variable-length
string of characters and converts it into
a short fixed-length string.
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Digital Signature Creation

Hashing
algorithm

Senders
private key

Hash of
message

Public-key
decryption

Digital
signature

Message
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Verification of Digital Signature

Message

Digital
signature

Hashing
algorithm

Hash of
message

Public-key
decryption

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Verify
signature

Senders
public key
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Digital Time-Stamping
What is a digital time-stamping service (DTS)?
It is an organization that adds
digital time-stamps to documents.

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Digital Time-Stamp Procedure

Attach date and time,
then digital signature
Message
Digital
Digitaltime
time
stamp
stampservice
service
Message

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Date and
time
Digital
signature

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Verification of Digital TimeStamp

Message
Date and
time

Hash message Hashed message

and date
and date
and time
and time

Verify
Verify
match
match

Digital
signature
Decrypt DTSs
signature with
DTSs public key

Decrypted
digital
signature

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Security Issues for Public-Key

Encryption Systems
What is cryptanalysis attack?
It involves various techniques for
analyzing encrypted messages for
purposes of decoding them without
legitimate access to the keys.
The simplest possible attack on a message
is the guessed plaintext attack.
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Security Issues for Public-Key

Encryption Systems
The whole security of public-key encryption
depends on the assumption that an attacker
cannot factor the product of two large
prime numbers (factoring attack).
The best way to prevent cryptanalysis and
factoring attacks is to use very long keys.

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Security Issues for Public-Key

Encryption Systems
What are some ways of protecting private keys?
Creating and distributing keys
Digital certificates
Certificate revocation list (CRLS)
Certificate chains
Certificate-signing units
Key expirations
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Learning Objective 6

Describe various ecommerce

applications, including
payment systems,
Web stores, and Web 2.0.

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Electronic Commerce
Technologies Issues and
Applications
Electronic Bill Payment Systems
Credit and Debit Card Systems
(Payment Card Industry Data Security Standard)
Payment Intermediaries (PIs)
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Electronic Commerce
Technologies Issues and
Applications
What is digital cash?
It is money created when a bank attaches
its digital signature to a note promising
to pay the bearer some amount of money.

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Electronic Commerce
Technologies Issues and
Applications
What is blinding?
It is a technique in which a bank issues
digital cash in such a way the it is
unable to link the payer to the payee.
What is a blinded digital signature?
It is a digital signature and related digital
cash that have been issued with blinding.
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Electronic Commerce
Technologies Issues and
Applications
What is an electronic wallet?
It is a computer program that keeps track of
the various keys and items of information
associated with digital money.
What are smart cards?
They are hand-held electronic
cards that are used for payments.
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Electronic Commerce
Technologies Issues and
Applications
Memory cards
Shared-key cards
Signature-transporting cards
Signature-creating cards
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Customers

The Internet
Store

Web Host

Web Browser

The Internet

Merchants
Web Site

Shopping
Cart Software

1
2

Online Transaction
Server
2

Digital
Certificate
Authority

Merchants
Database
Server
Private Gateway

Financial Institution
for Clearing

Merchants
Bank

3
Merchants Accounting
Information System

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Integrating The Web Store with

The Accounting System
Small companies web stores are hosted by
shopping cart software that manages catalog,
user registration, orders, email confirmation,
even financial reports that are then imported
into general accounting software.
Larger companies use ERP systems that
integrate all the major accounting functions,
as well as the web store, into a single software.
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Web 2.0

Wiki
Blogs
RSS news feeds
Mashups
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Web 2.0

JavaScript (client-side)
Perl, PHP, VBScript (Server-side)
XML, XSLTs
Rich Internet Applications
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Trust in e-Commerce
Cookies
Web Trust

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End of Chapter
3

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